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Quanta Services offers infrastructure solutions for the electric and gas utility, renewable energy, communications, pipeline, and energy industries in the U.S., Canada, and Australia. The company was formerly known as Fabal Construction and changed its name to Quanta Services in 1997, the same year that it was incorporated.

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Quanta Services (PWR): Company Profile, Stock Price, News, Rankings

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Quanta Services

quanta services

Good morning, welcome to the Quanta Services First Quarter 2026 Earnings call. At this time, all participants are in a listen only mode. A question-and-answer session will follow management's prepared remarks, and we ask that you please hold all questions until that time. I will provide instructions for the question-and-answer session. As a reminder, this conference is being recorded. If you have any objections, please disconnect at this time. I will now turn the call over to Kip Rupp, Vice President, Investor Relations, for introductory remarks.

Thank you, and welcome everyone to the Quanta Services First Quarter 2026 Earnings conference call. This morning we issued a press release announcing our first quarter 2026 results, which can be found in the investor relations section of our website at quantaservices.com. This morning we also posted our first quarter 2026 operational and financial commentary, and our 2026 outlook expectation summary on Quanta's investor relations website. While management will make brief introductory remarks during this morning's call, the operational and financial commentary is intended to largely replace management's prepared remarks, allowing additional time for questions from the institutional investment community. Please remember that information reported on this call speaks only as of today, April 30, 2026, and therefore you're advised that any time-sensitive information may no longer be accurate as of any replay of this call.

This call will include forward-looking statements intended to qualify under the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995, including statements reflecting expectations, intentions, assumptions, or beliefs about future events or financial performance. You should not place undue reliance on these statements as they involve certain risks, uncertainties, and assumptions that are difficult to predict or beyond Quanta's control, and actual results may differ materially from those expressed or implied. We also present certain historical and forecasted non-GAAP financial measures. Reconciliations of these financial measures to their most directly comparable GAAP financial measures are included in our earnings release and operational and financial commentary. Please refer to these documents for additional information regarding our forward-looking statements and non-GAAP financial measures.

Lastly, please sign up for email alerts through the investor relations section of quantaservices.com to receive notifications of news releases and other information, and follow Quanta IR and Quanta Services on the social media channels listed on our website. With that, I would like to now turn the call over to Mr. Duke Austin, Quanta's President and CEO. Duke?

Thanks, Kip. Good morning, everyone, and welcome to the Quanta Services First Quarter 2026 Earnings conference call. I want to begin by thanking our employees for their continued absolute performance mindset, dedication to safety, and commitment to delivering mission-critical infrastructure solutions for our customers. Your work and dedication is what makes everything possible. Quanta is off to a strong start of the year, with our first quarter results reflecting robust double-digit growth in revenues, adjusted EBITDA, and adjusted earnings per share along with record backlog. These results reflect the strength of our diversified solutions-based business model and our portfolio approach, enabling us to adapt to the evolving industry dynamics while consistently delivering execution certainty and profitable growth across varied market conditions.

I want to spend a moment on what we shared at our Investor Day on March 31st, because I think it is the right context for everything we are doing. Quanta has transformed, and our strategy for the next five years is firmly in place. What ran through everything we presented in our Investor Day was one word: certainty. Execution certainty, labor certainty, supply chain certainty, schedule certainty. That is what our customers need right now, and that is what this company is built to deliver. Utilities are being asked to double in size. Technology customers are demanding speed at scale they haven't dealt with before. Everything we have built over the past decade, our craft workforce, the integrated solutions model, the vertical supply chain investments, it all comes back to delivering that certainty at scale, and that is the conversation we are having with the customers every single day.

We listen to our customers, and we are becoming more deeply embedded in the way they plan and execute their capital programs. We are in the rooms where customers are planning their entire multi-year capital spend. We are negotiating much of the work directly. Our success is aligned with their success and with positive outcomes for the rate payer. That was not the case five years ago. We are there now. The trust we have built over decades, combined with the investments we have made in our craft workforce and integrated solutions model, is how we created a durable compounding business that is well-positioned to capitalize on large, visible, and durable market opportunities.

To that end, on the fourth quarter call, we announced an investment of $500 million-$700 million over the next several years in our power transformer manufacturing facilities and vertical supply chain strategy, which will double our power transformer manufacturing capacity. Additionally, we're nearly doubling our off-site manufacturing, fabrication, and logistics facilities over the next several years for an aggregate of approximately 6.7 million sq ft of facilities as part of our integrated fabrication and supply chain solutions. We are experiencing significant demand for these services, particularly for data centers, and these programs are just a couple of examples of Quanta's ability to provide total solutions across converging markets that are designed to deliver speed and certainty.

The versatility of our craft workforce and our solution-based approach is what de-risk all of us for our customers and for our investors. That fungibility, the ability to move our people across a $2.4 trillion total adjustable market converging around utility, generation, and large load, is what allows us to flex across markets, expand scope, and keep delivering. We have outlined an opportunity to more than double the earnings power of this company by 2030. When we look at our 15%-20% adjusted EPS growth target with the opportunity to stack above that, I wanna be clear, this is not easy, and the strategy has to be in place to deliver those numbers. We believe it is. Our guidance is prudent, it has always been prudent, and the results we reported this morning reflect exactly the kind of execution this plan is built on.

I will now turn it over to Jayshree Desai, Quanta's CFO, to provide a few remarks about our results and 2026 guidance, and then we will take your questions. Jayshree?

Thanks, Duke. Good morning, everyone. This morning, we reported first quarter results with revenues of $7.9 billion, net income attributable to common stock of $221 million or $1.45 per diluted share, adjusted diluted earnings per share of $2.68, and adjusted EBITDA of $686 million. Based on the continued momentum evidenced by our record $48.5 billion of backlog, the strong performance during the quarter, and improved visibility into the remainder of the year, we are raising our full year financial expectations. We now expect revenues to range between $34.7 billion-$35.2 billion, adjusted EBITDA to range between $3.49 billion-$3.65 billion, and adjusted EPS to range between $13.55 and $14.25. As Duke mentioned, we hosted an Investor Day on March 31st, outlined an opportunity to more than double the earnings power of this company by 2030.

This quarter represents a great start to a 20-quarter stretch, during which time we intend to deliver against that expectation, along with continued improvement in our consolidated margins and returns. Over the course of our 5-year plan, we remain committed to maintaining an investment-grade balance sheet and an acquisition strategy that's governed by our target leverage profile of 1.5-2 times, and the returns that we would otherwise generate by repurchasing our stock. 1 quarter in, the results reflect exactly the kind of disciplined compounding performance we committed to at Investor Day, and we remain focused on delivering that consistency for our stakeholders over the course of this plan. Additional detail and commentary on our 2026 financial guidance can be found in our operational and financial commentary and outlook expectation summary, both available on our investor relations website.

With that, we're happy to take your questions. Operator?

Thank you. We will now move to our question-and-answer session. We ask that all participants limit themselves to one question. If you have additional questions, you may re-queue, those questions will be addressed time permitting. If you have joined via the webinar, please use the raise hand icon, which can be found at the bottom of your webinar application. When you are called on, please unmute your line and ask your question. Our first question is from Nick Amicucci from Evercore ISI. Please unmute your line and ask your question.

Just wanted to drill in a little bit. Obviously, Duke and Jayshree, you guys had kinda mentioned the opportunity to improve margins on the underground and infrastructure. It seems like that was one of the drivers here in the quarter. Just wanted to see, should we kind of view that as more of a pull forward on that side of the house? Or was that somewhat contemplated as we think about just guidance going forward and kind of the 2030 timeline?

Yeah. Thanks for the question. When we looked at the underground, the work mix coming in, you know, we with DSI in that segment as well as just broad-based, you know, what I think is execution in the segment, we did a nice job, and I do believe that's where your earnings improvement are coming from UI. You know, not to say we can't improve some of the electric segment. You know, as we discussed, that's where you're going to see the incremental margin improvement. I do think it continues to get higher and we have the ability to operate in double digits.

Great. Then, Duke, as we kinda think about too, we've heard, you know, just even over the past 30 days, since the Investor Day, we've seen a lot more, I guess, rhetoric and just kind of commentary from a lot of, whether it's developers or utilities in general, or even the hyperscalers, just on this, on the notion of kind of more of a bridge power type of approach. Is that something that is kind of an incremental opportunity, just thinking that, you know, we can go first somewhat off grid, if you would, and then kind of provides the opportunity to then build out on the transmission side so you kinda get two bites at the apple? Is that, is that a fair assessment, or is that, kind of overstating?

I mean, everyone has a different solution to the issues of lack of generation. I think when we look at it, you know, the easiest, and I think the best way is connect to the grid, and most of our customers want to go to the grid at some point. There is bridge power solutions. They're out there. You know, there's Bloom and others that we're involved with on jobs, and I do think that is a good bridge power in many ways, and it will end up being backup power for the most part at some point. To have a microgrid at that scale with that intermittency in the type of learning that the chips have, it's very difficult, and not many people can build those microgrids more and run them.

Utilities are very good at it and, you know, it's much easier for them to do it than it is to try to run a microgrid from a technology company. Yes, it's complicated and the lack of generation is creating some opportunities for us on bridge power and many things. We're involved in all of it. You know, I would tell you large majority, vast majority are going to the grid at some point.

Thank you. Our next question is from Andy Kaplowitz from Citigroup. Please unmute your line and ask your question.

I'll stick to one question maybe in a couple parts. You mentioned in your prepared remarks that much of the additions to backlog were new large load facility project awards, and I think it's fair to say that you're seeing much more of these types awards. Do these awards tend to be, Duke, over $1 billion relatively consistently? How much of that acceleration that you're seeing is simply that you've just been able to educate your customers that Quanta can essentially do it all, as you've told us? Would you expect large load orders to continue to ramp up from here?

Yeah. I'm not sure who said that about backlog. It wasn't me. I would tell you it was largely across all segments, all disciplines. The backlog went up, including some 765 that was probably less than 25% of the increase, it was broad-based. It was some large load center, you know, it was a P&D and, you know, across our segments. I would tell you, like, that's it was normal course to me. There was no, like, something that stood out to say, "Oh, this is a large project," that drove that beat. I expect our backlog to continue to rise.

Our next question is from Steven Fisher from UBS. Please unmute your line and ask your question.

Thanks. Good morning. I know you guys just only gave 2030 targets, but I wanted to look out maybe even a little bit longer term, 'cause it seems like a part of the narrative being reflected in the stock is this longer term good visibility that you have. Duke, I mean, you've made some comments here and there about having some kind of programmatic discussion or opportunities beyond 2030. I was hoping you could perhaps elaborate a little bit of on those opportunities. To what extent is this mainly transmission projects? Does it include other data center opportunities directly? Is it renewables? To what extent do you have any more formalized agreements that go out actually that far beyond 2030?

I mean, we're looking at work beyond 2030 for sure. I do think you'll see an elongated cycle. You know, I don't think you're looking at something that's, you know, stops in five years. You're seeing decades of type gen. It took us, I don't know, 75, 100 years to build a grid that's here today. I don't think you can double the size of it overnight, for sure. Not in five years. It's gonna take a while to do that. You're seeing orders out on combined cycle engines into 2030, if I'm not mistaken. If you're just getting orders in 2030, it would tell you that the CGTs take 3 years to build once they hit the ground, and you're in 2033 at a minimum on the orders you get today.

I think when you think through it, the transmission, the infrastructure and what we see in front of us with robotics, the way the grid's used, the power, the electrification, I just see more demand, more demand and generation and the electrification of the world. I just, we see it for a decade plus.

Thank you. Our next question is from Julien Dumoulin-Smith from Jefferies. Please unmute your line and ask your question. To unmute your line on telephone, please press star 6.

Hi, good morning. It's Brian Russo on for Julien.

Yeah, just to follow up on your relationship with NiSource. The utility recently announced the Alphabet GenCo expansion on top of the original Amazon program. Just curious if that creates incremental scope for Quanta? More broadly, is the GenCo model generating additional, you know, pipeline opportunities, conversations beyond NiSource, particularly in that Midwest region? You had mentioned an opportunity of $5.7 billion related to NiSource. Just wondering what your thoughts are on expanding that market opportunity.

Yeah, we continue to expand, you know, that opportunity in the Midwest. I think, you know, you're seeing more demand, and we talked about that early on to be a program, and I think we'll continue to evolve. None of the CGT or even any of the generation for the most part that's been announced is not in our backlog. You know, we discussed air permits and things like that. As we get air permits and things, you know, as that progresses, you'll start to see that come into backlog probably the later half of the year and beyond. We continue to have a good relationship and at looking at that programmatic spend that you're seeing and they're announcing. We're right in the middle of it.

We're right there with the client on both sides of that. I, again, we talked about 5.7 that's growing every day, we like the area, we like NiSource, I think it'll continue to grow.

Okay, great. There's 1 follow-up on the backlog. You mentioned 765 was, I think, less than 20% of the increase. How should we think about the relationship with the AEP and the cadence of those transmission projects stacking up, in the future backlog, you know, over the next 18-24 months?

They keep announcing, you know, a bigger capital spend and we keep supporting it. I think you can look at our backlog and look at the way that the relationships are going with utilities and expect us to incrementally grow our backlog along with the utilities. We have a great relationship with AEP. As they announce 765, we're right in the middle of it with them, both on equipment as well as. You can see the investment that we made in the equipment in the quarter. We purposefully put it in the script to show you that we're moving forward on significant dollars against that 765 build in the vertical supply chain.

We're right there together and, you know, we have a U.S.-based supply chain that I think, you know, de-risk us and AEP. That has led to work and great opportunities together across the board on their system. We're excited about it and we're just getting started. It's very early, and I think you'll continue to see building a backlog, and this is just a, you know, this, what I would consider the 765 kV we put in was really an MSA that is normal course. I'm excited about what we can do there, and we're just getting started.

Our next question is from Atidrip Modak from Goldman Sachs. Please unmute your line and ask your question.

Yeah. Hey, Duke. I guess on the orders, you mentioned orders duration for CCGTs. Can you help us understand if the gas generation opportunity is something you expect to actively lean into and grow as a core focus over the years? Or should we think of that as more of an as opportunities come through from the JV-type solution? I guess we're trying to scale, understand what the scale of that opportunity could look like for you specifically.

It depends on the risk. I think we're comfortable on the single cycles. We're comfortable on many things. When it gets to a combined cycle, you know, we'll be prudent about how we take risk on them. You've been around a long time, I've seen failure, and we're not planning on that. I believe as the market progresses, as we progress as a company in those type markets, you'll continue to see it grow. We're highly focused on it. It's something that we see as a great addressable market that the inbound calls are daily, and I believe we can build them. We're gonna build them under contract structure that makes sense for us and the client and the rate payer. It just takes a bit.

They're long cycle type work, it'll take us a while to get to contract on many of them. It's something that you can't stick your toe in the water. You've got to jump in, we're gonna execute very well, we're gonna make sure that we've de-risked ourselves against the market. It's something we're focused on.

Thank you. Our next question is from Sangita Jain from KeyBanc. Please unmute your line and ask your question.

Good morning. Thank you. I have one for Jayshree. Jayshree, you left your free cash flow guidance unchanged. Just wondering why? I know your CapEx went up, but it only went up by, like, $50 million as a midpoint. Can you help us understand what you're thinking through?

Yeah. Hi, Sangita. Not really nothing to read into that. We gave a good range when we guided in the fourth quarter about our free cash flow. Yes, while we were pleased with the performance in the first quarter, it's just early. We didn't feel the need given the expectations where we are today to change that with the $500 million range that we provided you guys in the fourth quarter. Having said that, yeah, do I feel like we have greater confidence about being at the higher end of that cash flow range? Yeah, I do. As the year progresses, you can expect us to update you accordingly.

Thank you. Our next question is from Brian Brophy from Stifel. Please unmute your line and ask your question.

Yeah. Thanks. Good morning. Congrats on the nice quarter. You talked about meaningfully growing your offsite construction capacity in your opening comments. Can you talk about what you're seeing there that is driving these investments? Did you guys see any meaningful awards in that business in particular this quarter? Remind us how significant of a business that is and just the margin profile there. Thanks.

I mean, the announcements was supporting both our manufacturing capabilities. I mean, what we, in the prepared remarks, which would be our transformer manufacturing, which is majority of the capital. We have increased our size, you know, substantially on our prefab and pre-manufactured type product that Cupertino was a first mover for multi decades. We're supporting that. We're growing that business.

You know, it's a labor force multiplier the way I see it, and it allows us to really expand and work with clients across the country. As we see that market, we'll continue to expand it. It's much more of a programmatic spend, and it's not something that you're gonna see these large chunky projects. It just continues to be MSA type driven programmatic spend against the AI build, both cloud-based and learning-based type products. I think when we look at it, we'll continue to expand that due to the fact that labor constraints and we can force multiply what we have. You know, the fungibility of our labor as well. We like the area. We're investing in it, and, you know, the inbounds are daily.

Our next question comes from Steve Fleishman from Wolfe Research. Please unmute your line and ask your question.

Hi. Good morning. I guess two questions. First, just on the gas plant opportunities, I know you mentioned you're going to be careful on your risk controls on the combined cycle. Just how confident are you that you can get significant share, with, while also being careful? You know, are you losing business to competitors that are not necessarily as risk-averse? Just any thoughts on that?

I mean, it's a big market, Steve, so when we look at it, I think capacity, it comes down to cross-skill labor, multi-trade labor that we have and, you know, we can either work for others or do it ourselves in many ways. We've built a nice programmatic, you know, spends in areas that I think will continue. We have others that are, you know, coming in. It was not something that the company was focused on five years ago. When the risk gets less and we're able to do it in a prudent way for the rate payer and we're de-risking certain aspects of those things, you know, the single cycles don't bother us. The combined cycles do.

As we get into that, we look at it from a risk profile and work with the client, and I think it's the right way to look at it. If you try to fix them, they get expensive, and the risk out 5 years from now is substantial when you start looking at it. I think we're defining those risks, working contingencies, making sure that everyone is looking at it right, and for the most part, our sophisticated customers we work with realize it's the right way to look at total cost, and we're able to do that in a way that benefits everyone involved. We'll continue down that model, and it's worked very well. You know, we're not gonna win 'em all. It wasn't something that we expect to win 'em all.

It's a great business for us that if it, we have not acquired against that. We built this organically, and we'll size it to the market. It's not something that I think Quanta will grow with or without it.

Right. Just on utility interconnection issues, I'm curious if you're doing things that would help accelerate that. Is there things that you can? You know, this Three Mile Island restart not being interconnected till 2031 potentially was kind of shocking. What are things that can be done in maybe your involvement to kind of accelerate, you know, people getting interconnected?

Yeah. I think, you know, look, at the transformer manufacturing investment matters a ton when you start talking about 36 months on transformers, things like that. You have inbounds from Europe that are held up overseas and things of that nature. We've really de-risked the transformer piece of that, so we've helped there. We can build large voltage, high voltage line faster than anyone in the world, and I think we've set ourselves up nicely to bring jobs in faster. That said, I think it's more about the impacts to the rate payer and getting past that.

We need every incremental piece of capital spent for transmission benefits the rate payer. That's what we have to do as an industry, is make sure that we're telling the right story so we can move these faster. Permitting reform will certainly help speed that up. The queues are complicated. We're in the middle of them all the time. It's a moving target in many ways. We're constantly in the middle of trying to help expedite that through technology. We have a large planning group that works with utilities, but the target moves, and we continue to, you know, try to bring it in in the field. That said, the more we're involved upfront, the faster it goes as far as I'm concerned, and it benefits the rate payer all the way through.

We're all looking at permanent reform and ways to mitigate and get these things in the queue quicker. No doubt about it, and we're doing it, I think, in many, many areas.

Our next question comes from Alex Rygiel from Texas Capital. Please unmute your line and ask your question.

Thank you, and congratulations on a nice quarter. Government policies and regulations have a tendency of shifting market opportunities. Can you talk about the few that are most relevant to you today and how you're positioned to take advantage of or sort of reposition yourself for change?

Yeah, Alex. I think when we think through generation, our renewable business we haven't talked much about this morning, we had a nice quarter. We really did, and I think we built backlog on it. While we don't say much about it becomes a dirty word at times. I really like the solar batteries and even the wind in areas. It makes a lot of sense. You've seen us position ourselves nicely, and then the CGTs into gas generation. It's all forms of generation now for us, and we're trying to be the solution that people are asking for with the fungibility of cross-skill labor across those markets. We can move across markets.

We see markets that no one sees. We're able to take the labor, build on the front side of it, talk with technology, talk to our customer, and we listen. We're listening to them over this decade of making sure that we can move in the areas that we see provide the most benefit to our people and to the rate payer and our stakeholders. We've done it, we continue to do it. That's one example. Telecom, you know, it's growing a bit. We see BEAD, we see connecting data centers as well. We'll grow that business. I like our verticals right now and our supply chain as well. There's not much that we can't solve here.

We just have to continue to execute underneath, and the shiny objects are the shiny objects, but our execution and the guys, the men and women in the field are just, you know, as far as I'm concerned, the best in the world.

Secondly, obviously plenty of opportunities domestically, but international obviously is feeling the same kind of opportunities develop. At what point does Quanta get more aggressive in that international market?

You know, we've kept our Australian assets, and they've done a really nice job there. We can jump from Australia, need be, to, you know, really Europe and across the world. I don't see that any timeframe in the near future, but it certainly, maybe for the next guy or lady. It's very difficult to go international and we have plenty of growth that we see here for a period of time, but we're certainly set up to do that if need be.

Thank you. Our next question is from Manish Somaiya from Cantor Fitzgerald. Please unmute your line and ask your question.

Thank you so much for taking my question. Duke, two questions. One, the demand picture looks fairly robust across the board, have you seen any signs of potential weakness in any of the markets geographically or end markets by sector? Have any of the constraints changed? I know in the past we have talked about craft labor, supervision, all that stuff being a challenge. That's question one As part of that, if you can just touch on the M&A pipeline, what opportunities are you seeing geographically and by business? Where would you wanna do something if a right opportunity arose? Thank you.

I'll go backwards. M&A, we see plenty of opportunity there. There's great businesses, 100-year-old companies that have long-standing, you know, what I would consider execution across many, many markets. Our ability to execute on M&A is, you've seen it over the last decade. You'll continue to see it going forward. The inbounds are strong. You know, people believe in what we're doing, people believe in our strategies, and they wanna sell their businesses here. We're happy to have them and happy that they wanna be here. You'll continue to see that. You're starting to see the strategies come together here and the things that we invest in. There's not one market. We have some holes in the business in certain regions.

We have the holes in the business in certain, from my, from my standpoint, certain verticals, so we invest in them. The great businesses are there. We're not doing this for a labor strategy. We're building labor nicely underneath. We added, you know, relatively 5,000 to 6,000 organically last year, and we'll do that again this year plus. I've said this before, you know, labor builds labor. A journeyman makes a journeyman. Money doesn't do that. The more journeymen you have, the more you can scale, and we realize that, and we invest in it constantly and have for over a decade. Well over a decade. You know, M&A is not a labor strategy for us.

That's out, and then the rest of it's just, you know, we've given, I think, good guidance on what we think for our strategy, and we'll invest against it. And also when you think about you talked about labor a bit as well, and the fabrication facilities, the things that we're doing there, pre-manufacturing on both sides of that, whether it be DSI, multi-trades, we're using that investment with technology to really expedite what we can do in the field and take risk out of it. I mean, you're starting to see the seasonality of the business even change a bit. I can't tell you that that's what that looks like yet because I haven't got my head around it. The first quarter, you know, it doesn't fall off as much.

We had some northern climbs that were tough, and you've seen us operate through those markets this quarter. I think you're gonna build a business that is resilient across four quarters and predictable. I like what we're doing there. The end markets continue to, you know. I've not seen holes in them. There will be stops and starts when we get this big, and we start adding this much backlog and the business grows. We're not gonna add the same amount of backlog every quarter. Those things are, you know, it just moves around. Consistently on a CAGR basis, I expect our backlog to continue to rise for, you know, as far as I can see it over time.

It might not be quarter-over-quarter, but it'll certainly be year-over-year at this point. We like what we see out there, and I'm not seeing holes in the markets that we serve.

Our next question comes from Philip Shen from Roth Capital Partners. Please unmute your line and ask your question.

Hey, guys. Thanks for taking my questions. You took your technology and load center outlook up substantially, increased from 70% to 110% of revenue growth. We heard, you know, a lot of hyperscalers increase CapEx for the year last night. What do you see for the coming quarters for this end market? Can you give some additional color on your conversations with the hyperscalers? Is there a potential that this segment could grow even faster than what you've laid out?

Yeah, just to comment on the slide that you're discussing, that's directional. If it was up to me, I wouldn't have that slide, but I'll defer to the team on it, but it is directional. You're right, it is growing fast, and it is a, you know, fast-paced market. We've made acquisitions against it, you can expect that to grow faster than things that we haven't made acquisitions. It's a great market. It. We've talked about the technology being a, you know, trillion plus TAM, and you can see what the capital being spent from all the larger hyperscalers out there. Yes, I mean, it's going to grow faster, and we continue to lean into it.

The opportunities are daily, and we'll take advantage of those opportunities when they come in, from balance of plant data centers to pieces thereof. I just think we're doing a nice job there. We talked about it. We had a strategy. We're executing against it, and, you know, We did. We are looking at 100-plus % growth in it, due to acquisition, due to strategy, due to a lot of things. Organically as well, it's growing nicely, and We'll continue to see it grow. We're early. I mean, we've only been doing this, like, a year and a half. I mean, you can see, like, how big the business is already. If you do the math, it's a huge business, and it'll continue to grow.

I think people are coming here daily because we can execute. We can execute, and we're certain, and we can do it fast. We have the craft on the backside. We're not building homes. We're certainly something that we can do and do well. We're excited about it.

Great. Thanks, Duke. Second 1 here. Maybe this is more for Jayshree. Can you give some color on why the 2026 EPS guide % increase was less than the Q1 EPS beat? How much of the Q1 earnings beat was a pull forward potentially? You know, you guys beat by 30% on the adjusted EPS line on Q1 or in Q1, but the EPS guidance was only raised by 7% in 2026. Were there some one-timers? Thanks, guys.

Yeah, I'm not, I'm not following that, not following that math, Phil. I'll admit. We raised our EPS. We took forward our beat in the first quarter. We also raised our guide in the back half. That's reflected in our adjusted EPS. Most of that was EBITDA strength for the year, as well as a little bit of a tax beat that we carried forward. But the beat should be reflective of both the first quarter as well as our views of the back half of the year.

we took a prudent approach to it, Phil. I mean, I think when we looked at it, we certainly were prudent about it. It's not normal for us to move the backside unless we're, you know, feel fairly confident about it. The way I did the math, we raised it $50 million past the beat. Maybe my math's wrong. Anyways, I got to pass CEO math.

Thank you. As a reminder, if you could please ask one question at a time, and then re-queue for any extra questions. Our next question is from Jamie Cook from Truist. Please unmute your line and ask your question.

Can you hear me? Congrats on a nice quarter. I guess, Duke, a lot of the questions to you are more sort of on the acquisition front, which you guys have been very successful about. I guess, you know, my question is more on potential for portfolio optimization on the divestiture side. You and I have talked about businesses that perhaps, or I've asked you about businesses perhaps that detract from growth margins or returns. As we become more of this, you know, broader power play, I'm just wondering if there's parts of the portfolio that aren't meeting financial metrics, you know, where there's an opportunity there, I guess to enhance the growth or margins or returns as these other businesses are just lower margin in return.

I guess just my second question, you know, a lot of the acquisitions you've done have been more small mom and pop companies that you've known for years. To what degree do you see something more perhaps transformational happening in the space, or the need for that to happen just given, you know, how fast the market is growing and the ability to just do something quicker to, you know, be able to meet customer demand that's out there? Thank you.

Thanks, Jamie. We look at the portfolio against the strategy constantly. I do think, you know, we always try to optimize it, whether it's not invest capital in it, stay in it for the long haul. We're always looking to optimize our portfolio. If we can get the right returns on things, if it's the right timing, we have no issues divesting. That said, we're able to use craft in many ways across segments, across business lines that I think we've done a nice job with, where it may look like a pipeline business, but it's not. We can do other things there that we have and optimize it all for purpose. That said, we will continue to look at those things.

Quanta Services (PWR) Q1 2026 Earnings Call Transcript

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